Appellate Review of Markman Hearings

In Markman, the Supreme Court declared that determining the meaning of patent claims, i.e. “claim construction,” is a question to be decided by the court; the Seventh Amendment right to a jury trial does not apply. Markman v. Westview Instruments, Inc., 517 U.S. 370, 372 (1996). Shortly thereafter, in Cybor, the Court of Appeals for the Federal Circuit held that de novo review applied when results from these newly-created ‘Markman hearings’ are appealed. Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1448, 1451 (Fed. Cir. 1998) (en banc).   Earlier this year, the Federal Circuit granted a rehearing en banc to determine if Cybor should be overruled, and what, if any, deference should be given to a District Court’s claim construction. Lighting Ballast Control LLC v. Philips Electronics N. Am. Corp., ___F.3d___, WL 667499 (Fed. Cir. Feb. 21, 2014) (en banc). The court considered three options: (1) reaffirm Cybor and maintain de novo review, (2) overrule Cybor and declare claim construction a question of fact, or (3) adopt a “hybrid” standard of review that affords deference to the District Court’s factual determinations but preserves de novo review of the “ultimate” conclusion. Amici from industrial and technological companies advocated reaffirming Cybor. Academics and practitioners generally favored either the hybrid approach or the overruling of Cybor. Relying on stare decisis, a 6-4 majority reaffirmed Cybor.   The majority pointed out that since Cybor was decided, Congress has not acted to overturn it while enacting other patent legislation during that time. They further explained that predictability and consistency favor maintaining the status quo. Consistency is a concern particularly relevant in patent law...

Supreme Court to Rule on Patent Eligibility for Process Claims

Last month, the Supreme Court heard oral argument in Alice Corporation v. CLS Bank. Many hope the Court’s decision in this case will help clarify the patent eligibly standard for process claims – particularly those process claims that are computer implemented and/or involve business method patents. Patent eligibility is based on 35 U.S.C. § 101 which allows any “process, machine, manufacture, or composition of matter” to be eligible for patent protection. However, laws of nature, natural phenomena, and abstract ideas are not eligible for patent protection. It is important to note that patent eligibility is distinct from patentability (novel, useful, definite, non-obvious, etc.). For example, a chemist who discovers a previously unknown element cannot patent that element because it is a natural phenomenon. It is ineligible for patent protection regardless of how new and useful it is. Traditionally, process claims were evaluated under the “machine-or-transformation test” which conferred patent eligibility on the process if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. In the 1970s, broad claims to computer-implemented processes that utilized a mathematical algorithm or formula without meaningful limitations were held ineligible for patent protection under the abstract ideas exception despite requiring a computer in order to be performed. See Gottschalk v. Benson and Parker v. Flook. Four years ago, in Bilski v. Kappos, the Court affirmed the Federal Circuit’s ruling that the process of “hedging risk” in the commodities trading industry is also an abstract idea not eligible for patent protection. However, the Court went on to declare that the machine-or-transformation test...

New Zealand Changes Patent Laws to Exclude Software

The legendary Patent Troll Wars will not see much of a theater in New Zealand, after Parliament just this month determined that software is no longer able to be patented in New Zealand. New Zealand’s Patent Act 2013 seeks to clean up the patent process by no longer granting patents for software, “strengthen the criteria for granting a patent by introducing an ‘absolute novelty’ standard, and examine patent applications for usefulness and the presence of an ‘inventive step,'” and “simplify the procedures for granting a patent, streamline the procedures for challenging a patent, and expand revocation procedures to allow any person, at any time, to apply to the Commissioner of Patents for a grant of patent to be revoked.” Patent Act 2013, Introduction. These changes are designed to allow several things, but the overarching goal is to make it less-likely that so-called ‘patent trolls’ will be able to press their case in New Zealand. So far, it appears as though the Kiwi tech world is on board with the changes as well, and several American publications are urging the U.S. to follow suit. http://www.zdnet.com/new-zealand-bans-software-patents-7000019955/ http://www.iitp.org.nz/news/archives/4926-Newsline_Extra_Weekly_roundup_of_big_news_in_tech?r=2-IITP-News (for a list of articles supporting the new Act) The Institute of IT Professionals chief Executive Paul Matthews stated, “Today’s historic legislation will support our innovative technology industry, and sends a clear message to the rest of the world that New Zealand won’t tolerate the vexatious practice of ‘patent trolls’. That is, when software patents are created with the sole purpose of bringing costly litigation against inventive technology companies…In short, the banning of software patents is a victory for common sense.” It remains to be seen...